Note 15 - Measurement of fair value of financial instruments

In connection with implementation of IFRS 13, interim financial statements are required to present fair value measurements per level with the following division into levels for fair value measurement:

- quoted price in an active market for an identical asset or liability (level 1)

- valuation based on other observable inputs either directly (price) or indirectly (derived from prices) than quoted price (used in level 1) for the asset or liability (level 2)

- valuation based on inputs not taken from observable markets (unobservable inputs) (level 3)

For further details, see Note 26 Measurement of fair value of financial instruments in the annual accounts, and note 27 Fair value of financial instruments.

As of second quarter fixed-rate loans are classified in level 3.

Shares held for sale are not included in the tables below.

The following table presents the Group's assets and liabilities measured at fair value as of 30 June 2013: 
         
Assets Level 1 Level 2 Level 3 Total
Financial assets at fair value through profit/loss        
Derivatives   101   2,683     - 2,784
Bonds and money market certificates 4,260 12,682     - 16,942
Equity capital instruments   98     - 821 919
Fixed-rate loans     -     - 2,752 2,752
Financial assets avaliable for sale        
Equity capital instruments     -     - 46 46
Total assets 4,459 15,365 3,619 23,444
         
Liabilities Level 1 Level 2 Level 3 Total
Financial liabilities at fair value through profit/loss        
Derivatives   100   2,188     - 2,288
Total liabilities   100   2,188     - 2,288

 

The following table presents the Group's assets and liabilities measured at fair value as of 30 June 2012: 
         
Assets Level 1 Level 2 Level 3 Total
Financial assets at fair value through profit/loss        
Derivatives   22   4,221     - 4,243
Bonds and money market certificates 4,942   9,414     - 14,355
Equity capital instruments   108     - 422 530
Fixed interest loans     -     - 2,389 2,389
Financial assets avaliable for sale        
Equity capital instruments     -     - 63 63
Total assets 5,072 13,634 2,874 21,580
         
Liabilities Level 1 Level 2 Level 3 Total
Financial liabilities at fair value through profit/loss        
Derivatives   24   4,073     - 4,097
Total liabilities   24   4,073     - 4,097

 

 

The following table presents the Group's assets and liabilities measured at fair value as of 31 December 2012: 
         
Assets Level 1 Level 2 Level 3 Total
Financial assets at fair value through profit/loss        
Derivatives   61   3,039     - 3,100
Bonds and money market certificates 3,764 10,825     - 14,590
Equity capital instruments   131     - 601 731
Fixed interest loans     -     - 2,585 2,585
Financial assets avaliable for sale        
Equity capital instruments     -     - 46 46
Total assets 3,956 13,865 3,231 21,051
         
Liabilities Level 1 Level 2 Level 3 Total
Financial liabilities through profit/loss        
Derivatives   62   2,728     - 2,790
Total liabilities   62   2,728     - 2,790

The valuation of equity capital instruments classified in level 3 is done at the individual group company – in the main SpareBank 1 SMN Invest and SpareBank 1 SMN. Routines have been established for ongoing valuation of all share investments and the valuation is done using various intervals in relation to the size of the investment.

For participations seedcorn funds and venture funds, use is made of valuations from the managers of the various funds. These valuations are based on guidelines either from the European Venture Capital Association (EVCA) or the International Private Equity (IPEV) guidelines. Other funds such as property funds, normally use external broker’s estimates. Funds or companies with few participants use the original cost or market price if transactions have been carried out at the company.

The owner interests in Nets Holding and Nordito Property are valued each quarter by SpareBank 1 Gruppen and distributed to all Alliance banks. This valuation is based on an average of five different methods where the last known transaction price, profit per share, dividends per share and EBITDA are inputs to the assessments.

Effect on result of financial instruments belonging to level 3   
       
  30 Jun 2013 30 Jun 2012 31 Dec 2012
Realised gain/loss   - 0   -0
Change in unrealised gain/loss  -25   -15 11
Total effect on result -25 -14 11
© SpareBank 1 SMN